India cuts potash subsidy by nearly a fifth for 2014/15

MUMBAI, March 28 (Reuters) - India has cut potash subsidy by
nearly a fifth to 9,400 rupees ($160) per tonne for the year
starting April in an effort to contain a ballooning fiscal
deficit, a government source and an industry official told
Reuters.

A smaller subsidy would keep retail potash prices elevated
despite a drop in overseas prices, dashing any hopes for a
recovery in demand in one of the world's top importers of the
fertiliser that global miners are banking on to counter a slump
in prices.

"The (federal) Cabinet on Thursday approved reduction in
subsidy to 9,400 rupees," said a government official, who
declined to be identified.

India relies on imports to meet its entire potash demand. It
has accounted for about a tenth of global shipments over the
past five years, but its share has been slipping as local prices
rise due to subsidy cuts and a weaker rupee.

Reuters exclusively reported last month that India will cut
potash subsidy by nearly a fifth.

Potash imports deals for 2014/15 can be signed soon as the
government has fixed subsidy for the next year, said P.S.
Gahlaut, managing director of Indian Potash Limited, the
country's biggest importer.

India is expected to buy 3.5 million tonnes of potash for
the next financial year, Gahlaut had said earlier this
month.